The best and worst luxury real estate markets for 2023 are expected to be these two.

According to Knight Frank, Dubai was ranked as the top luxury real estate market in the world, with prices expected to rise 13.5% in 2023.

The worst performers are predicted to be Seoul and London.

As interest rates rise and economies weaken, even the most robust luxury markets are anticipated to cool next year.

According to a new report, wealthy investors betting on luxury real estate would do best by placing their money in Dubai or Miami next year.

According to real estate consulting firm Knight Frank, Dubai was ranked as the world’s top luxury, or “prime,” real estate market, with prices projected to rise 13.5% in 2023. Miami came in second, and prices are anticipated to rise by 5%. Following with 4%, anticipated increases were in Dublin, Lisbon, and Los Angeles.

Seoul and London are predicted to have the worst performances the following year, with price drops of 3% predicted for each. New York came in at number 13 and was ranked in the middle of the pack. Prices are predicted to rise by 2% in 2019.

As interest rates rise and economies weaken, even the most robust luxury markets are predicted to cool next year, according to Knight Frank. Knight Frank revised its earlier projection of 2.7% price growth across the 25 cities to an average increase of 2% in 2023.

According to the revision, the world’s wealthy, who appear to be immune from inflation and economic slowdowns, are delaying major real estate purchases or becoming pickier about prices in light of rising interest rates.

Although prime markets are better protected from the effects of higher mortgage rates, they are not exempt, according to the report. “Across most prime residential markets, the shift from a seller’s to a buyer’s market is already underway.”

Dubai’s price increases for 2023 represent a significant slowdown after 2022 when prices there rose by 50%. Over the past year, Dubai has witnessed a rise in the number of wealthy residents, largely due to Russians seeking a safe haven for their wealth, yachts, and real estate amid Western sanctions due to the conflict in Ukraine.

While the overall sales volume increased 73% over the prior year, prices for single-family homes in Dubai increased 13% in October.

Given its low tax rates and the increasing number of financial companies locating their headquarters or offices in South Florida, Miami continues to be a favorite haven for the wealthy.

Even though New York is only expected to grow by 2% in 2019 as opposed to 5% in 2022, many brokers predict falling prices, particularly in Manhattan. According to Knight Frank, foreign buyers who are “seeking more, rather than less, exposure to the U.S. dollar as the Federal Reserve ramps up rates” will be advantageous for New York.

According to the report, Singapore is the only Asian city in the top 10 and one of only four cities whose forecast has improved over the past six months. Rich Chinese citizens are moving their money—and frequently their families—to the island to escape strict Covid lockdowns and a faltering economy, and Singapore is reaping the benefits.

Cash will rule in all 25 markets because sellers will prefer to deal with buyers who are prepared to pay in full upfront, according to Knight Frank. In many nations, political and economic unpredictability will cause a flight to safety in the housing market, “pushing buyers to mature and transparent luxury markets.”